The main mechanisms for resolving issues that arise in the application of international tax principles to MNEs are contained in these bilateral treaties. The Articles that chiefly affect the taxation of MNEs are: Article 4, which defines residence; Articles 5 and 7, which determine the taxation of permanent establishments; Article 9, which relates to the taxation of the profits of associated enterprises and applies the arm’s length principle; Articles 10, 11, and 12, which determine the taxation of dividends, interest, and royalties, respectively; and Articles 24, 25, and 26, which contain special provisions relating to non-discrimination, the resolution of disputes, and exchange of information.
Related Guidelines
Related Case Law
- India vs UPS Asia Group Pte. Ltd., March 2022, Income Tax Appellate Tribunal – Mumbai, Case No 1220/Mum./2021UPS Asia is a company incorporated under the laws of Singapore and is engaged in the business of provision of supply chain management including the provision of freight forwarding and logistic services. In 2012 UPS Asia had entered into a Regional Transportation Services...
- Australia vs Satyam Computer Services Limited, October 2018, Federal Court of Australia, Case No FCAFC 172The question in this case was whether payments received by Satyam Computer Services Limited (now Tech Mahindra Ltd) from its Australian clients – that were royalties for the purposes of Article 12 of the tax treaty with India, but not otherwise royalties under Australian...
- UK vs G E Financial Investments Ltd., June 2021, First-tier Tribunal, Case No [2021] UKFTT 210 (TC), TC08160The case concerned a complex financing structure within the General Electric Group. The taxpayer, GE Financial Investments Ltd (GEFI Ltd), a UK resident company was the limited partner in a Delaware limited partnership, of which, GE Financial Investments Inc (GEFI Inc) a Delaware...
- Czech Republic vs. FK Teplice, a. s., November 2017, Supreme Administrative Court , Case No 1 Afs 239/2017 – 37According to the Regional Court, it follows from Section 2 of the Income Tax Act that a footballer is subject to tax in the Czech Republic by reason of his residence, permanent home or other similar criteria if he had resided in the...
- Germany vs “Z Pipeline”, May 2023, FG Düsseldorf, Case No 3 K 1940/17 F“Z Pipeline” is a limited partnership which operates a network of pipelines. The network runs through Germany, Belgium and the Netherlands. During the year in question, “Z Pipeline”‘s administrative HQ was in Germany. Operational control of the pipeline was exercised by an ‘operations...